Board of Commissioners advances county investment strategy

March 13, 2014

GARFIELD COUNTY, CO – A county investment policy and related strategy for 2014 were approved by the Garfield County Board of County Commissioners (BOCC) at its meeting Monday, March 10. The plan closely follows state statutes and now includes the ability to purchase municipal bonds. The board also increased the maximum investment level, in order to gain higher interest earnings on non-liquid securities.

In 2013, the Board’s decision to increase the county’s non-cash or term investments from $55 million to $85 million resulted approximately in an additional $170,000 in earnings.

Garfield County Finance Director Ann Driggers presented a cash flow analysis to the BOCC this week that provided monthly projections of revenues and expenditures. Driggers recommended the BOCC increase term investments for 2014 from $85 million to $100 million for the months of March through September, based on this in-depth analysis and the county’s existing cash balances.

Colorado counties, dependent on property taxes for a majority of their income, receive about two thirds of their collections by April 30 each year, creating a cash surplus, which is then spent down through the year.

Garfield County Treasurer Georgia Chamberlain said working closely and diligently with the finance department and the county manager to better analyze how the county is spending made the investment strategy possible.

“We received critical input from the finance department in order to maximize our return on investment.” Chamberlain said, “We collect the majority of our revenue in the first six months of the year, due to property taxes, and then the construction period begins and our expenditures increase. This allows us a short-term gain on investments while our deposits are high. All of the revenue is immediately earning interest. We are increasing revenue without increasing taxes.”

The BOCC reestablished its Investment Advisory Board (IAB) in May 2012, which made the recommendation to the commissioners. The IAB consists of two citizen members, Jay Rickstrew of Alpine Bank and Ian Exelbert of Glenwood Insurance Agency, along with Garfield County Commissioner Tom Jankovsky, County Manager Andrew Gorgey, County Attorney Frank Hutfless, Chamberlain, and Driggers.

“The decision of the BOCC in 2013 to shift $25 million from short-term to long-term investments yielded this county $170,000 without any tax increases whatsoever,” stated Gorgey. “This is prudent stewardship of public funds.”

Jankovsky shared his gratitude for the work of the county treasurer, finance director and citizen members of the IAB. “I would thank the IAB for taking a good look at this so we can maximize on our investment,” he said.

The IAB meets quarterly to review the county’s investment performance, and gives direction to the county treasurer. Chamberlain manages those funds, including investments. The county contracts with Cutwater Asset Management for investment advice and investment strategies.

Dave Witthohn, director of Cutwater Asset Management, said “2013 was a good success story for Garfield County, and we’d like to further that strategy and make the portfolio a little more efficient. We are trying to balance between cash-on-hand and what should go into term investments so we can generate more income.”

Total return on the county’s investment portfolio in 2013 was just under $700,000. The BOCC voted to increase the amount of cash investments from $85 million to $100 million for 2014.